Casinos on a roll after hurricane
The highway along the Mississippi Gulf Coast would be forlorn if not for the casinos, which are having their best year ever.
The devastation of Hurricane Katrina has proven to be little more than a temporary setback to the conversion of formerly sleepy beachfront communities into the Las Vegas of the Deep South.
Although affordable housing is scarce and businesses have trouble getting insurance coverage to rebuild since the storm, 11 casinos are open in Biloxi, Gulfport, Bay St. Louis and Lakeshore. Two are under or nearing construction and there’s talk of more coming.
“A lot of businesses haven’t reopened and aren’t going to reopen,” said Pat Probst, a security supervisor at Beau Rivage casino in Biloxi. “The casinos are probably the only thing that has kept our economy going.”
The 12 casinos operating along the coast two years ago were no match for Katrina’s winds and storm surge on Aug. 29, 2005. At the time, state law required the gambling portion of the resorts to be on barges in the water.
In a special session after the storm, the state Legislature decided to let coastal casinos build on shore.
“A lot of the casinos, more than half, said that if they had to come back on the water, they wouldn’t have reopened,” said Beverly Martin, executive director of the Mississippi Casino Operators Assn. “It affected their insurance.”
So far, casino companies have spent $1.7 billion rebuilding along the coast, according to the Gulf Coast Business Council, and new projects are in store. Harrah’s Entertainment Inc. has started the largest post-Katrina project with its $700-million Margaritaville Casino & Resort, due to open in 2010 in Biloxi.
According to the Mississippi State Tax Commission, coastal casinos took in $124.7 million in gambling revenue in July, up from $101.7 million in July 2005, the month before Katrina. The casinos have gained $887 million from gamblers in the first eight months of 2007, an increase from $863.5 million in the first eight months of 2004, the last full year before Katrina.
At that rate, the casinos are in line to exceed 2004, their best year ever, when gamblers left behind $1.23 billion.
Like their resort counterparts elsewhere, the Mississippi casinos are pushing non-gambling amenities such as golf courses, spas, restaurants, and meeting and entertainment venues.
Larry Gregory, executive director of the Mississippi Gaming Commission, said the split between gambling and non-gambling revenue for coastal casinos was about 65% to 35% -- and headed more toward the non-gambling side.
“I could see them becoming the Atlantic City of the South,” said Andy Holtmann, editor of the Las Vegas-based Casino Journal, a trade publication.
